SEV & Taxable Value Chart

SEV going up just as the market does, Taxable Value capped at inflated rate.

2

108,000

103,000

3

116,640

106,090

4

125,971

109,272

5

136,049

112,550

6

134,689

114,801

SEV going down, Taxable Value still increasing per inflation rate.

7

133,342

117,097

8

132,009

119,438

9

130,690

121,826

10 (Uncapped)

124,156

124,156

House Sold in Year 9.

11

117,948

117,948

Taxable Value goes down because it cannot be higher than the SEV.

Summary
In summary, for many years homeowners have benefited from Proposal A. It has capped or limited the value used to calculate annual taxes to a level that is more sustainable. Proposal A does not work as well in a declining market because property taxes are driven by the taxable value, which increases annually by the rate of inflation, determined annually by the State of Michigan. As a result, taxable value often lags behind the state equalized value and can increase even though there may be a decrease in the state equalized value.